At a Glance:
Wonder Electricals is an OEM/ODM champ in the Indian fan market, silently building ceiling and pedestal fans for your favorite brands while raking in a juicy 30%+ profit CAGR. But the market? It’s giving this stock a P/E of 131x—yes, your fan doesn’t spin that fast.
1. 💡 WTF Do They Even Do?
- Business Model: OEM + ODM supplier of ceiling fans, exhaust fans, BLDC fans.
- Customers: 10+ major brands across India. You might be sleeping under their fan and not even know it.
- Exports: They’ve quietly entered Gulf & neighboring countries—an interesting moat.
📌 NOT a brand themselves – their growth is entirely B2B-driven. Low visibility, but high volume.
2. 💰 Financials Overview – Profit, Margins, ROE, Growth
| Metric | FY25 |
|---|---|
| Revenue | ₹894 Cr |
| Net Profit | ₹17 Cr |
| Net Profit Margin | 1.9% |
| Operating Margin (OPM) | 4.3% |
| ROCE | 18.2% |
| ROE | 19.7% |
| EPS (TTM) | ₹1.24 |
| P/E | 131x |
📈 Sales CAGR (5Y): 25%
📈 Profit CAGR (5Y): 30%
💡 Profit growth has picked up recently — FY25 PAT grew 70% YoY.
3. 🔍 Valuation – Is It Cheap, Meh, or Crack?
Let’s be blunt.
- P/E of 131x – absolutely bonkers for a fan OEM.
- P/B of 21.5x – your ceiling fan has better rotation economics.
- OPM at just 4%, while top-tier consumer durables hover at 10%+
- Fair Value Range:
Assuming ₹17 Cr PAT grows at 30% CAGR for 3 years, FY28 PAT = ₹39 Cr
Even at a generous 40x P/E → FV = ₹1,560 Cr market cap = ₹116/share
❗Current MCap = ₹2,167 Cr → overvalued by ~35–45%
⚠️ Unless they dramatically expand margins or launch their own brand (à la Havells), current pricing is… well, irrational exuberance.
4. 🔥 What’s Cooking – News, Triggers, Drama
- ✅ Solar Power Plant Commissioned: Cost saving initiative with 640 kW unit at Roorkee.
- ✅ New TPW Fan Line Installed: Commercial production in 2 months could boost volumes.
- 🔁 Revised FY25 results filed – minor correction in tax, no change in audit opinion.
5. 🏗️ Balance Sheet – How Much Debt, How Many Dreams?
| Year | Debt (Cr) | Reserves (Cr) | Net Worth (Cr) |
|---|---|---|---|
| FY22 | ₹22 | ₹40 | ₹53 |
| FY25 | ₹99 | ₹87 | ₹100 |
🧱 Debt growing fast (from ₹25 Cr to ₹99 Cr in 2 years) to fund capacity and working capital.
6. 💸 Cash Flow – Sab Number Game Hai
| Year | CFO (₹ Cr) | FCF (approx) |
|---|---|---|
| FY24 | -₹17 | Negative |
| FY25 | -₹22 | Negative |
- ❌ Burning cash despite profitability = classic sign of working capital intensity.
- 👎 Receivables = 112 days → Long collection cycles from OEM clients.
- ✅ Inventory control improving (Inventory Days dropped to 28)
7. 📊 Ratios – Sexy or Stressy?
| Ratio | Value |
|---|---|
| ROCE | 18.2% |
| ROE | 19.7% |
| OPM | 4.3% |
| Net Margin | 1.9% |
| Debtor Days | 112 |
| CCC | 50 Days |
💡 Healthy ROE, but very thin margins and delayed collections.
8. 📉 P&L Breakdown – Show Me the Money
| Year | Sales (₹ Cr) | Profit (₹ Cr) | OPM % |
|---|---|---|---|
| FY22 | 398 | ₹7 | 4.0% |
| FY23 | 402 | ₹6 | 4.2% |
| FY24 | 570 | ₹10 | 4.4% |
| FY25 | 894 | ₹17 | 4.3% |
📈 Volumes booming, profits improving, but margin ceiling is stubborn.
9. ⚔️ Peer Comparison – Who Else Is in the Game?
| Company | P/E | ROE % | OPM % | P/B |
|---|---|---|---|---|
| Wonder Electric | 131x | 19.7% | 4.3% | 21.5x |
| Crompton | 41x | 17.4% | 11.3% | 6.8x |
| V-Guard | 54x | 16.0% | 9.2% | 8.0x |
| Blue Star | 57x | 20.5% | 7.3% | 10.9x |
| Amber | 95x | 11.2% | 7.4% | 10.1x |
🙃 Wonder has better ROE than most, but worst OPM, highest P/B, and crazy P/E.
10. 🧾 Miscellaneous – Shareholding, Promoters
- Promoters: 71.79% (Consistent)
- FII Holding: 9% – some smart money still there
- Public: 19%
- 💥 No pledges – ✅
👀 FII holding peaked at 11% in 2023 and dropped → suggests some profit-booking at high valuations.
🧠 EduInvesting Verdict™
Wonder Electricals is a quiet OEM compounding machine, growing topline and bottomline steadily while most fan companies are busy with IPL sponsorships. But here’s the twist:
⚠️ The stock is priced like it’s a luxury brand, not a behind-the-scenes supplier.
If BLDC fans could cool down valuations, Wonder stock would need a gale-force wind.
Unless it:
- Launches its own brand
- Boosts OPM to 8–10%
- Or surprises with margin expansion via automation or exports…
…it’s just too hot at 131x earnings.
🎯 Fair Value Estimate (EduRange™): ₹95 – ₹115
(based on 30% PAT CAGR, 35x forward earnings multiple, adjusted for OEM model risk)
✍️ Written by Prashant | 📅 28 June 2025
Tags: Wonder Electricals, BLDC Fans, OEM supplier, high P/E stocks, fan manufacturing India, consumer durables
